Research On The Procurement Risk Management In ODM Project In JE Company

Risks exist almost everywhere. There has been increasingly focus on risks and risk management since the financial crisis in 2008. As the market is shrinking, there is a rise in uncertainty and competition in schedule, cost and supplier management. Thus, risks related supply chains are severer. Original design manufacturers(ODM) comprise the majority of manufactures in China. These manufacturers are faced with threats and challenges. In the manufacturing industry, material procurement is an important part of supply chain. Therefore, it is crucial to use methods of risk management to control procurement risks, improving the efficiency of procurement management. This will contribute to the realization of value appreciation and the development of enterprises.The dissertation is based on the techniques of risk management, especially the techniques related to procurement management. For original design manufacturers in JE(Johnson Electric) Company, the dissertation has developed a risk management system, including risk identification, risk evaluation and risk control. First, the dissertation used brainstorming and process failure mode and effects analysis(PFMEA) to identify risks in terms of schedule, cost and supplier management. As to schedule risks, the main problems were the insufficient input of technical skills and skilled staff. The rise of raw materials' prices mainly contributed to the cost risk. In addition, regarding supplier management, there was a potential risk of selecting a competent supplier. Next, the dissertation constructed an evaluation system for evaluating different procurement schemes with Analytic Hierarchy Process(AHP). Finally, risk control and proactive measures have been put forward, facilitating the success of original design manufacturing projects.